More ROI in TPRM: Keys for Modern, Efficient Vendor Risk Programs

Modern third-party risk management (TPRM) programs do more than just mitigate risk or check a compliance box—they create measurable business value. But many TPRM teams are set up to fail with a reactive, resource-intensive approach.

This is “legacy” TPRM: an outmoded approach that often takes more time and effort than your team has to give, leading to risky tradeoffs in the number of vendors you assess or the detail with which you assess them. 

Modern TPRM automates manual steps in the vendor-security assessment process, makes it easier to use a wide range of data to perform a thorough assessment, and generates additional time for your team to reallocate to value creation. That’s ROI, and it is an engine of business resilience and growth. 

In our most recent webinar, industry experts Elizabeth Dunsmoor (TPRM Principal, Shared Assessments), John Finizio (VP of Security, Risk, and Compliance at Whistic), and Lance Mueller (CEO of Venseca) shared insights on how to build more efficient, impactful TPRM programs designed to reduce risk, increase velocity, and maximize return on investment. 

Let’s take a look at the key takeaways that can help transform your legacy TPRM program from a cost center to a revenue driver. 

Takeaway 1: A Clear Vendor Inventory is the Foundation for Effective TPRM

One of the most critical steps in TPRM is ensuring you have a complete and accurate vendor inventory. Without this foundational element, risk management efforts can become fragmented, redundant, or misaligned.

But it’s not always simple to build an accurate, accessible inventory: large organizations may work with hundreds or even thousands of vendors. This complexity creates roadblocks to a vendor inventory: 

• Organizations with subsidiaries and affiliates often struggle to consolidate vendor lists, especially when procurement is decentralized.
• Ensuring visibility across multiple jurisdictions and business units requires cross-functional collaboration.
• The demand for vendor services means that best practices are often overlooked, leading to Shadow IT

Recommended Actions

The panel of experts suggested four ways to overcome these challenges and build an effective inventory:

1, Engage Procurement and Accounts Payable Teams—Misalignment with your procurement team can leave you in the dark, so it’s important to partner with them and help them understand the risks. The same is true of your accounts payable team: invoices indicate active vendors. As Lance Mueller explains, “If you’re paying an invoice, that means you have a vendor. Start by working with AP to build  your inventory.”

 2. Classify Vendors by Risk Levels—Use a standardized methodology to categorize vendors as critical, high, moderate, or low risk. Some of the common criteria used to develop consistent risk scoring include the types of data and systems your vendor can access, the volume of data they can access, and their overall importance to your business. 

3. Leverage Technology for Inventory Management—Utilize a purpose-built TPRM platform to centralize your vendor information. Since all TPRM activity should take place within your platform, housing your inventory there streamlines access, makes it easier to collaborate, and makes it simpler for business units to follow procurement processes around vendor risk.  

4. Communicate with Vendors Early—The earlier you can engage with vendors on the TPRM process, the easier it is to increase visibility. This lowers the possibility of a vendor falling outside your inventory system. 

Takeaway 2: Measuring Success Through KPIs and KRIs Increases Program Maturity

For TPRM programs to demonstrate ROI, they must move beyond compliance-driven activities alone and focus on measurable outcomes. Programs that define clear Key Performance Indicators (KPIs) and Key Risk Indicators (KRIs) can track progress and articulate value to stakeholders more easily. This can lead to more refined processes, efficiencies, and visibility for your program (which can, in turn, lead to additional resources). 

Many organizations struggle to collect, measure, and report on the most impactful aspects of their programs. The panel identified some key mistakes organizations can avoid as they build out their reporting:

• Overloading assessments with manual processes that slow down risk identification. Automation is not simply about speed; it’s also about the ability to see the overall process more clearly and concisely. This makes it easier to find the right metrics.
   
• Failing to define measurable objectives tied to business outcomes. This is where your partnership with other business units like procurement serves another important purpose—it allows you to understand business drivers related to your third-party ecosystem, and thus define what success looks like for your TPRM team. As Mueller puts it, “Too many risk teams operate in a vacuum. The best programs are those that align with what the business actually needs—not just what security thinks is important.”
   
• Using a one-size-fits-all approach rather than tailoring risk assessments to vendor criticality. This goes back to your risk scoring system; ranking your vendors by a consistent rubric of risk vectors makes it simpler to compare them and find the appropriate level of security assessment for the tier of risk. 

Recommended Actions

For John Finizio, building out a reporting and measurement system for your TPRM isn’t about capturing all related data; it’s about capturing the right data. “It’s easy to get caught up trying to measure everything,” he explains, “but not every metric is relevant; focus on what actually demonstrates progress and value for your organization.”

Here are some metric types that may move the needle for your organization:

1. Efficiency Metrics (KPIs)

• Percentage of vendors in each risk tier you’ve developed
• Average time to complete a risk assessment
• Percentage of vendor assessments completed within a target timeframe

2. Risk Exposure (KRIs):

• Percentage of critical vendors without completed assessments
• Number of vendors with unresolved high-risk findings
• Average time for vendors to remediate identified risks

3. Stakeholder Metrics

These will vary depending on the organization, but your dashboard should include some way to track and measure a few KPIs that are most relevant to key stakeholders. Regularly communicate with leadership, procurement, and business units to ensure KPIs/KRIs reflect business needs. "Stakeholders will tell you what they care about. If you're not listening, shame on you," says Finizio.

Takeaway 3: Leveraging External Data and AI Reduces Manual Work and Strengthens Risk Insights

Traditional vendor risk assessments often rely solely on vendor-provided documentation, leading to delays and outdated risk insights. However, organizations can now augment internal data with real-time external sources and AI-driven analysis.

This is one of the biggest innovations leading organizations away from “legacy” TPRM and toward a more modern approach. But what does that really mean for your team? Well…

 Legacy TPRM:

• Reliant on manual questionnaires, leading to long response times from vendors (if they respond at all) and back-and-forth to get additional clarity.
• Burdensome to utilize additional vendor info; sure, a vendor may send you their SOC 2 audit report, but it then falls to your team to manually search the document, essentially leaving it to you to fill out your own assessment.
• Time-consuming and risky; 96% of companies report they would assess more vendors if they had the time and resources. But since they don’t, they are simply not assessing as much—which means they are taking on unnecessary risk.  

Modern TPRM:

• AI-first; AI technology provides opportunities to automate at every step of the process, including questionnaire response/collection. In Modern TPRM a vendor can send you raw security data like a SOC 2, and AI can assess it against your controls (including your own custom questionnaire or any industry standard you choose) in minutes.
• Insight rich; AI analysis makes it possible to begin and even complete a thorough assessment using a wider variety of security intelligence, including trust centers, exchanges like G2 or the Whistic Trust Catalog, detailed audit reports, or external security risk scores. No more relying solely on the questionnaire.
• Fast, efficient, and ROI-producing; with time saved on each assessment, your teams can assess more vendors in greater detail and reallocate resources to value-generating activity.

As John Finizio puts it, "The goal is to get a complete picture using all available data—vendor-provided, external sources, AI analysis—so you can make smarter decisions faster.”

Recommended Actions

Our panel highlighted some ways to access additional data sources to fuel this shift toward modern third-party risk management:

1. Use External Risk Data—Supplement assessments with:

• Cybersecurity risk scores (e.g., SecurityScorecard, BitSight)
• Regulatory compliance databases
• Publicly available vendor security disclosures

2. Apply AI to Risk Assessments—AI tools can analyze:

• Vendor security policies, SOC reports, and compliance documents
• Threat intelligence feeds to detect emerging risks
• Previously completed assessments you may have already collected or that your vendors have used with other clients

3. Monitor Fourth-Party Risk—Extending risk assessments beyond immediate vendors ensures visibility into subcontractors.

Next Steps to Increase ROI

The panelists reinforced that a well-structured TPRM program is not just about compliance but must provide real business value. By focusing on vendor inventory accuracy, KPI/KRI measurement, and external data integration, organizations can build more efficient, scalable, and ROI-driven risk programs.

To help your organization move forward, the panel suggests you:

• Audit your vendor inventory and ensure it includes all active vendors.
• Define measurable KPIs/KRIs that align with your organization’s risk priorities.
• Assess your external data strategy—are you leveraging available intelligence sources to improve efficiency?
• Engage stakeholders early to drive alignment and increase program adoption.

Whistic is also helping organizations take this leap to modern TPRM and greater ROI with our AI-first suite of capabilities, called Assessment Copilot. This includes:

• Vendor Summary—Run a full assessment of all vendor information against your preferred standard or questionnaire in minutes. 
• SOC 2 Summary—Use your key controls to summarize hundreds of pages of SOC 2 audit reports into hyper-focused five-page summaries (great for reporting, too!)
• Vendor Insights—Query every vendor in your inventory at the same time instead of one by one. 

You can access the full webinar on-demand here. And if you’d like to learn more about generating ROI through TPRM, schedule some time with our team of experts and we’ll show you how it works.